Paid Social Spend Shifts
- Short Term: Many brands paused paid social ads the first week of June, but we’re already seeing Facebook spend (in blue) ramp back to May levels across industries.
- Long Term: As the New York Times reported, some brands are staying away from paid social in an effort to take a stand against Facebook’s hands-off policy positions.
Our perspective is that turning off paid social in the short-term to make a stance and support your customers does not pose a risk to your business; it actually has the potential to build a relationship with your customers. Regarding long-term shifts to paid social spend, we have seen that the most successful brands are building a diversified marketing mix across channels and have already divested in paid social and broadened their strategy to include channels such as direct mail, affiliates, and SMS. However, as long as consumers are spending time on Facebook and Instagram, advertisers will continue to invest.
Home Décor Spending Moves Online
- Short Term: Outdoor furniture categories such as Outdoor Furniture Sets and Outdoor Chairs are showing considerable growth compared to pre-COVID levels, likely due to seasonality and people planning to spend summer holidays at home.
- Long Term: Online home furnishings saw considerable month-over-month growth in April (+62%) and May (+26% compared to April) and experienced a strong finish to the month of May, likely aided by deep Memorial Day discounts (source: Attentive). This shows the potential for a more sustained consumer behavior shift as customers become even more comfortable buying home décor and furniture online.
Email Competition Heats Up
- Short Term: Email volume continued to grow in May, and the portion of those emails that focused on promotions held steady at around 70%, which created increased competition as retailers used discounts to draw consumers’ attention.
- Long Term: Competition for consumer’s attention will only become more intense as many states open up and people spend more time outdoors and ultimately, away from computers. Personalization, segmentation and investment in new channels for CRM such as SMS will be crucial.
Four Optimizations to Make Now:
- Measure and track changes in paid social spend to understand immediate impact to business and long-term, down-funnel effects.
- Build a diversified marketing mix by investing in new channels (e.g., direct mail, SMS, affiliates) to be ready for the crucial Fall/Holiday season.
- Home furnishings and décor brands should plan for improved online experiences and invest in initiatives that build strong relationships with online customers.
- Cut through the noise with personalized and relevant messages in email and SMS.